I'm sorry to say but if you are not what she wants, then she wouldn't be happy with you and not much is going to change that reality. You're going to have to get over her and on the matter of your friend, if they want to be together you'll also have to get used to that fact as well.

I did the same thing when I was in uni the first time. Ask them to stop paying and take a loan, when it's your money on the line suddenly there is motivation. That's what I did. It's really unfair of you to do that, you should at least tell your grandparents so they aren't shocked by the news later.